Ooredoo, Aldar Properties get attention in trading; spreads widen; Dubai to host Expo 2020

By Christine Van Dusen

Atlanta, Nov. 27 - The new notes from Qatar's Ooredoo QSC and United Arab Emirates-based Aldar Properties PJSC were active on Wednesday as Dubai celebrated its designation as host of Expo 2020 and issuance quieted ahead of the Thanksgiving holiday in the United States.

"Tomorrow being Thanksgiving and Friday being Friday, I expect liquidity to be poor at best," a London-based trader said. "And then we can say farewell to November."

The Markit iTraxx SovX CEEME ex-EU index spread on Wednesday widened to 231 basis points over Treasuries from Tuesday's 228 bps spread. The corporate index, seen Tuesday at 247 bps, moved out to 252 bps over Treasuries on Wednesday.

"The market has been fairly well-bid as of late, but it certainly didn't run away," the trader said.

He saw buyers of Dubai's Jebel Ali Free Zone (Jafza), Dubai Electricity and Water Authority's (DEWA) 2020s and sellers of the perpetual notes from Emirates Islamic Bank. And Dubai-based Majid Al Futtaim Holding LLC's (MAF) perpetuals were "popular in the Street," he said.

This came as the Dubai sovereign was selected as the site for Expo 2020, a world's fair that is expected to boost sukuk sales for the government and corporates in the host country.

Only Emaar Properties seemed to skip out on the associated rally, he said.

"Paper is around on both the 2016s and 2019s," he said. "The 2019s are now 28 bps wider on the month."

In other trading from the Middle East on Wednesday, investors were attracted to Saudi Arabia-based chemical manufacturer Saudi Basic Industries Corp.'s (Sabic) 2020s, a trader said.

The company's 2013 euro notes are set to mature on Friday.

GEMS, QNB popular

Also attracting investor interest on Wednesday were the perpetual notes from the United Arab Emirates' GEMS MEA Sukuk Ltd., which priced the 12% notes at par, a trader said.

They closed Wednesday's session at 102.

"Qatar National Bank's 2018s were popular, last trading at 981/2," he said.

Ooredoo active in trading

The new notes from telecommunications firm Ooredoo - $1.25 billion 3.039% notes due 2018 that priced at par to yield mid-swaps plus 160 bps - were trading near re-offer on Wednesday and later moved to 99.90 bid, 100.05 offered, a London-based analyst said.

DBS Bank, Deutsche Bank, HSBC, QInvest and QNB Capital were the bookrunners for the Regulation S deal.

Aldar attracts buyers

Abu Dhabi-based real estate company Aldar Properties' $750 million 4.348% notes due 2018 that priced at par to yield mid-swaps plus 290 bps fared better than Ooredoo in the secondary market, the analyst said.

The notes moved up 25 cents in early trading on Wednesday and were sighted at 100.05 bid, 100.15 offered.

Standard Chartered Bank, Dubai Islamic Bank, First Gulf Bank, Goldman Sachs and National Bank of Abu Dhabi were the bookrunners for the Regulation S deal.

By the European afternoon the notes were hovering near 100.15 bid, 100¼ offered.

"My Aldar 2014s have been sold," a trader said. "I did point out they were cheap."

Afren moves up

London-based and emerging markets-focused oil and gas company Afren saw its new $360 million issue of seven-year senior secured notes that priced at par trade 13 cents better on Wednesday, the analyst said.

Citigroup, BofA Merrill Lynch and Credit Suisse led the deal.

Later on Wednesday morning the notes were spotted at par bid, 100 5/8 offered.

"More retail investors on the new Afren," a trader said during the London afternoon. "They're trading in the 100 3/8 to 100 7/8 context."

Ukraine in focus

In other trading ahead of the Thanksgiving holiday, bonds from Ukraine experienced a sell-off after Russian President Vladimir Putin said a trade deal between Ukraine and the European Union would pose a threat to the Russian economy.

"The [Ukraine] sovereign curve sold off by a point, with some bids getting hit," said Svitlana Rusakova of Dragon Capital.

"Corporates were generally a ½ point lower," she said.

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